OpenSea cuts artist royalties + Napster enters Web3
The biggest stories in music NFTs this week
Gm music fans,
Here’s the biggest news in Web3 music this week.
1. OpenSea cuts creator royalties to 0.5%
Two months ago I interview OpenSea’s vp of product for a story in Billboard. Here’s what he told me about the idea of cutting artist royalties:
“Honestly, the idea of just getting rid of creator fees made no sense.”
I guess a lot can change in two months…
OpenSea just switched its policy and made creator royalties “optional” (with a 0.5% minimum).
In other words, traders no longer need to pay the artist their full cut when they sell an NFT.
What’s going on?
OpenSea’s marketshare has collapsed over the last 12 months, taken by rival marketplaces like X2Y2, and more recently Blur. Both cut out artist royalties in a bid to attract traders.
It worked. OpenSea’s marketshare is down from 75%+ last year to just 15% yesterday. OpenSea is now changing its policy to keep up with its rivals, but hurting artists in the process.
Cutting out royalties is a huge blow for musicians in Web3. It’s the reason why many came to the space in the first place. Last year, 12x platinum musician and Eminem collaborator Illa da Producer told me:
“Coming from the music world, the promise of being able to earn royalties in perpetuity without the interference of middlemen, was something I could only dream about.”
Jeff Nicholas, founder of music nft project Warpsound was incredibly blunt about platforms making royalties optional.
“In many ways, it amounts to theft by the marketplace.”
Is there any good news for artists?
Sort of. Royalties will still be enforced by OpenSea and Blur on new collections if they use an on-chain enforcement tool. But that’s no comfort for artists or projects that have released NFTs in the past.
2. Napster is back from the dead with Web3 acquisition
Napster just acquired Mintsongs — a Web3 music platform that shut down last year.
Former Mintsongs CTO Garrett Hughs will join Napster as an advisor and Nate Pham as product lead.
We don’t know much more, but we assume Napster will use the defunct Mintsongs codebase to fast-track their NFT ambitions. Napster relaunched in September last year, backed by blockchain companies Hivemind and Algorand.
3. a16z highlights Web3 music talent
Leading investment firm a16z just launched its Crypto Startup School.
26 teams were chosen to join the accelerator program (from 8,000+ applicants). And we spied two names from the Web3 music ecosystem among the cohort:
Bello - an NFT analysis tool built by Ellie Ferrisi and Adam Levy. Bello has strong roots in the Web3 music community, used by many musicians in the space to understand more about their collectors.
Formless - the team behind Web3 music protocol Share. It aims to give artists control of how their music is distributed and allow efficient micropayments.
4. NFT sample packs keep coming
NFT sample packs are definitely going to be a thing. It allows for scarce and valuable sample kits combined with token-gated access to a tight community of producers.
Arpeggi is leading the way, and their latest sample pack is here featuring samples from TK’s Eternal Garden.
5. Legacy music exec jumps to Web3
Warner Music Group’s former CEO Stephen Cooper joins the board of directors at OneOf.
OneOf is a music NFT platform built on Tezos, hosting drops for Biggie Small’s estate, Doja Cat and the Grammys in the last 18 months.
6. Builders keep building
Bonfire launched ‘Native NFT Drops’ - The drag-and-drop website builder now allows artists to create an NFT drop from within the Bonfire dashboard.
OohLaLa launches ‘On-off-switch’ - Artists can control whether their music is streamable on the website (which aggregates music from various NFT platforms).
Thanks for reading!
Did I miss anything? Let me know on Twitter. Have a great weekend and see you next week.